State calls for advisers as it moves to open pipeline jewel to investors

The Kenya Kwanza government has officially launched the process to privatise the state-owned Kenya Pipeline Company (KPC), setting an ambitious completion deadline of March 31, 2026. 

This move, coming just days after Parliament gave its final nod, initiates one of the country’s most significant and closely watched privatisations in a decade.

Public notices published by the Privatisation Commission on Thursday formally kicked off the transaction. 

The advertisements confirmed that the sale will take place through an Initial Public Offer (IPO) on the Nairobi Securities Exchange (NSE), with the expected closing date for the transaction being  March 31, 2026." 

The sale is expected to inject approximately Sh100 billion into the budget-strained Ruto administration.

The sale is a cornerstone of the Ruto administration’s strategy to raise crucial non-debt revenue and reduce the fiscal deficit. 

The government reckons the sale will "unlock the company’s full potential," fund social programmes, and "empower ordinary Kenyans to own a stake" in a profitable national asset.

To meet the ambitious March 2026 deadline, the Commission has immediately launched a swift procurement process for the advisers who will manage the complex transaction. 

A separate Request for Proposals (RFP) published has further invited bids for eight critical advisory roles, with October 21, 2025 being the submission deadline.

The services are split into lots, including a Lead Transaction Adviser to coordinate the process, Lead Sponsoring Stock Brokers, Legal Advisers, and Receiving Banks. 

The use of the "Quality Cost Based Selection method" under Kenyan public procurement law emphasises the level of scrutiny the process will undergo. 

This expedited timeline, with bids due in less than two weeks, highlights the urgency at the ministry of Treasury, which views the KPC sale as a vital financial shot in the arm for the 2025/2026 budget.

The launch follows the National Assembly's final approval on October 1, which came with stringent conditions designed to prevent the sale from being dominated by a wealthy few, directly invoking parliament's constitutional oversight role.

Fearing a takeover by a powerful "cabal" of tycoons, lawmakers have imposed a definitive ownership structure.

For instance the government must retain not less than 35 per cent of shares and may only privatise "not more than 65 per cent." 

MPs directed the Commission to safeguard the sale against excessive concentration of shares" and "set a maximum ownership limit for any one shareholder."

"This is a strategic national asset, not a trophy to be handed to a few billionaires in a backroom deal," a senior parliamentary official involved in the process told The Standard earlier, capturing the legislature's strong sentiment.

Additional resolutions mandates a minimum level of participation by Kenyan citizens, including youth, women, and persons with disabilities, and require an Employee Share Ownership Plan (ESOP) for KPC's workforce.

To ensure transparency, Parliament has ordered a full forensic valuation and further demanded that all liabilities be comprehensively assessed and disclosed. The lawmakers further directed the office of the Auditor General to audit the entire process upon completion. These liabilities include pending lawsuits worth Sh5.75 billion and unresolved compensation claims amounting to Sh3.8 billion.

KPC is considered a jewel in the crown of Kenya's state-owned enterprises. Established in 1973, it operates an extensive 1,342-kilometer pipeline network and storage facilities that are vital for transporting petroleum products from the port of Mombasa to the hinterland.

Beyond Kenya, its infrastructure serves landlocked East African nations including Uganda, Rwanda, South Sudan, and the Democratic Republic of Congo, reinforcing Kenya's role as a regional energy hub.

Unlike many parastatals, KPC is highly profitable. For the financial year 2023/24, the company reported total revenue of Sh35.37 billion and a profit after tax of Sh6.87 billion. This strong financial performance makes it an attractive prospect for both institutional and retail investors, drawing comparisons to previous successful Kenyan IPOs like Safaricom and KenGen.

The parliamentary blueprint aims to restrict the privatied entity to its core mandate, forbidding it from venturing "into the importation or sale of petroleum products" without prior approval from regulators and the National Assembly itself. 

This key restriction is designed to protect fair competition in the strategic and cash rich petroleum sector.